TravelSky Technology (696) H1 2024 earnings summary

Executive summary

• Achieved total revenue of RMB4,041.8 million in 1H 2024, up 22.2% year-over-year, with net profit attributable to shareholders rising 13.9% to RMB1,367.2 million and EPS increasing to RMB0.47.

• System processed volume reached 352 million passenger trips, up 24% year-over-year and above 2019 levels, with international air passenger traffic recovering to 80% of 2019.

• Operating profit reached RMB1,613.7 million, up 20.5% year-over-year.

• No interim dividend declared for 1H 2024; 2023 DPS was RMB0.16.

• Continued digital transformation and innovation in aviation IT solutions, maintaining a leading position in the sector.

Financial highlights

• Aviation IT service revenue grew 19.8% to RMB2,265.0 million (56% of total revenue); system integration revenue more than doubled to RMB679.8 million; settlement and clearing services revenue rose 50% to RMB278.0 million.

• Other revenue declined 15.1% year-over-year, mainly due to a 49.4% drop in payment business revenue.

• Total operating expenses increased 16.4% year-over-year to RMB2,535.3 million, with staff costs up 31.7% and software/hardware selling costs up 142.1%.

• Net cash inflow from operating activities was RMB1,287.4 million; cash and cash equivalents stood at RMB9,562.5 million as of June 30, 2024.

• Basic and diluted EPS was RMB0.47, up from RMB0.41.

Outlook and guidance

• Civil aviation passenger traffic in China expected to reach 700 million in 2024, the highest in history, with steady domestic growth and further international recovery in 2H 2024.

• Focus on high-quality development, technological innovation, and strengthening safety and governance systems.

• Emphasis on enhancing aviation safety, operational quality, and revenue, while accelerating emerging business development.